FAQ’s

Frequently Asked Questions
what are the advantages of buying a franchise

In short you are buying a business in a box, its a proven business model, where you are supported on a national level, in your local territory. Some franchises of postcode or area exclusivity, meaning ANY customers attracted by national marketing or band awareness campaigns, become your customers. In fact in a study conducted by  Entrepreneur magazine it concluded that the survival rate of new franchises was 90% compared to just 15% of startups.     

What Is licensing

Licencing is generally a twelve month agreement which allows the licencee to use a brand name or system of the licensor. The licencee pays a fixed annual amount, percentage of sales or a mixture of both to the licensor. Licensing differs from franchising in two main areas, training and support. With licencing it is unusual to receive and training or support.  

How much money will i need

That depends on what franchise you are considering. Here at Assist International we will help you plan your budget so that you know exactly what is required. As a ball park figure we normally allow 150% of the cost of the franchise as cash required however, the cash required figure can be financed. So for instance if you are looking at a franchise of  £12,995 we would suggest  £19,500 as your capital required, however, you could then finance  £13,500 of this leaving only  £6,000 required by you. Please note that capital required can vary based on your circumstances and the type of franchise you are considering. Please contact us and we can help you determine your requirements.

can you help me find finance

Yes certainly. Because of the high success rate of franchising banks and other institutions will make money available based on your projected cash requirements. This means you could finance up to 70% of the required capital. Contact us for more details. 

how much profit will I make

We get asked this question a lot and of course the answer is – that depends. There are several factors that you should consider when projecting your potential profit.

1. Is the market you are entering buoyant and is it expected to grow over the coming years.

2. What does the Franchisors projections reveal, although these are only an estimation they should give you a reasonable basis for assessing what is possible. 

3. What is your willingness to work hard. Although you are buying a business in a box you still have to put in the hard work in the early years, so that you can reap the benefits from year three on.   

What experience do i need

Most franchisors offer individual training which covers their specific franchise needs. We always suggest that understanding the principles of marketing and sales will help a franchisee succeed. Online courses are available so you will be up to speed in no time. We can work out a detailed plan for you based on your chosen franchise. 

what training will i receive

The training you receive will depend on the franchise you are considering. Some franchisors have a continual training programme, whilst others give you the basics of what you need to get your business started. In helping you decide which franchise to consider, we can help you work out a detailed plan of training requirements based on your personal circumstances.  

is there a legal agreement that protects me

Yes there should always be an agreement that protects both you and the franchisor. The key sections that should be covered are; areas of responsibility, non-performance, sale, payments and restrictions. We are not franchise lawyers but we can point you in the right direction

can i sell my franchise once i have built the business

Yes, in fact thats the whole reason why a lot of people purchase a franchise in the first place. Typical multiples when calculating sale prices are anything from 5x to 12x depending on the type of franchise and the sector you are involved in. For instance if after year five you have been making consistent profits over two years of  £70,000 and you are in a reasonably attractive industry where multiples of 8 are being achieved, you would expect to sell your business from around  £560,000

glossary of terms

Acknowledgement of Receipt

This is signed by the prospective franchisee and provided to the franchisor (in hard copy or electronically signed) as proof of the date the FDD was received by the prospect.

Advertising Fee

Amount paid by the franchisee to the franchisor as a contribution to the franchise system’s advertising fund(s). The fund is typically established to pay for the creation and placement of advertising and used to offset the franchisor’s administrative costs relating to “retail/brand” advertising. Payments are calculated as a percentage of gross sales.

Broker

An outside salesman or firm which undertakes for a fee or commission the sale of franchises for a franchisor. Franchise brokers are disclosed within the FDD.

Business Plan

A planning document that details the objectives for the business and establishes processes and measures for meeting those objectives.

Capital Required

The amount of cash you are required to have available in order to purchase a franchise or business opportunity.

Due Diligence

Due diligence is the fact-finding process a prospective buyer should go through prior to buying a franchise or business. The purpose of doing due diligence is to make sure that a franchisor’s claims are accurate and their business model is a sound investment. Due diligence done properly looks at a franchise’s operations, financials, training program, interviews with current franchisees, just to name a few. It is advised that you consult with a franchise attorney or broker prior to buying a franchise or business opportunity.

Field Representative

An employee of the franchisor responsible for ensuring compliance by the franchisee with system standards. Also responsible for providing assistance to franchisees in the operation of their businesses.